Additional HMO licensing consultation 2023

You can view the full consultation document as a PDF here: 2023 additional HMO licensing consultation document [pdf] 14MB

Or as a HTML here: 2023 additional HMO licensing consultation document [HTML]

The additional hmo licensing consultation results can be found here.

The results are also available as a PDF download: 2023 HMO Consultation Results and Feedback Report [pdf] 4MB

As per the below diagrams:

In scenario 1 hasn't changed, so a leasehold rented flat that is an HMO (red) will require its own individual licence, and in addition, the building will require a S257 Additional HMO Licence (yellow).
In scenario 2 from the 2023 Consultation Document, the building would have required a S257 HMO Additional Licence (yellow) and this would have covered the common parts and the freeholder's flat, but not any other flat, whether an HMO or not.

It was considered that the situation could be that the (other) leaseholders might end up contributing to the freehold S257 HMO Licence (as would be expected), but which would also include the Freeholder's flat. The question was raised about how that cost would be divided/filtered down to the leaseholders. It was also raised why should a leasehold flat require a separate licence but not the freehold flat.

In scenario 3, amended from scenario 2, the building will now require a S257 HMO Licence and the freeholder's flat will require its own Additional HMO Licence. The other two flats may also require their own individual licences (if they are applicable HMOs).

This means that there could be a scenario where a freeholder needs a S257 licence for the building and (if like the scenarios shown below where there are three flats), three separate flat Additional HMO Licences, although it is probably very rare that a building would contain multiple licensable flats in their own right within it.

Scenario 1: Building licensable (S257) (yellow). Leasehold flat licensable (red).

Scenario 2: Consultation: Building inc. F/H top floor flat licensable under S257 HMO Licence (yellow).

Scenario 3: Actual: Building licensable (S257) (yellow). F/H top flat licensable in its own right (additional) (green).

The Housing Act 2004 provides local authorities with the power to designate areas as being subject to discretionary additional licensing schemes, in relation to some or all of the HMOs in that area which are not already subject to mandatory HMO licensing.

In 2010, a general approval was issued to enable local authorities to designate additional licensing schemes in their area, provided there is a minimum 10-week consultation period. In applying an additional licensing scheme, the local authority must consider:

• that a significant proportion of the HMOs, that will be subject to the proposed designation, in the area are being managed sufficiently ineffectively as to give rise, or likely to give rise, to one or more particular problems either for those occupying the HMOs or for members of the public
• whether there are any other courses of action available to them that might provide an effective method of dealing with the problem or problems in question
• that the making of the designation will significantly assist them to deal with the problem or problems
• any representations made in accordance with the consultation are not withdrawn; and consult persons likely to be affected by the designation

Concerns have been raised about the increasing number of HMOs, especially those which are smaller and do not currently need a mandatory licence, is resulting in poorer quality accommodation. Research and analysis have been undertaken by the Building Research Establishment (BRE) on our behalf. This research concluded that there was sufficient evidence to support the introduction of an additional HMO licensing scheme in parts of Arun. The analysis shows that conditions in many of these properties, where sharing of cooking, washing and toilet facilities is occurring or where a building has been converted without building control approval, may be below acceptable standards. However, these poor conditions are being largely missed as they are rarely or never inspected, apart from on a purely reactive basis. Detailed analysis of HMOs and housing in the Private Rented Sector (PRS) is included in the BRE Housing Stock Model Data report and in our consultation document.

We are proposing to introduce an Additional HMO licensing scheme in River Ward in Littlehampton and Hotham and Marine Wards in Bognor Regis.

You can view the maps and full list of roads included on this separate webpage.

The following types of rented properties will be included within the proposed scheme:

• Houses and flats
  • A house occupied by three or four persons forming more than one household who share a basic amenity, that is sharing bathroom, toilet or cooking facilities.
  • A flat occupied by three or four persons forming more than one household who share a basic amenity located within the flat, that is sharing a bathroom or WC or cooking facilities.
  • A building that has been converted into flats but not all the flats are fully self-contained flats. There may not necessarily be sharing of all amenities, but at least some sharing of bathroom, WC or kitchen facilities.
• Section 257 HMOs:
• Converted block of flats, either the whole building or part of a building, where the following apply:
  • The building or part of it (including those with commercial premises within the overall building and including common parts of buildings) has been converted into self-contained flats; and
  • The conversion into self-contained flats did not (and still does not) meet the Building Regulations 1991 (or later); and
  • Less than two-thirds of the flats are owner-occupied.

Individual flats in converted properties will be considered as owner-occupied if they are occupied by:

• Someone who has a lease of the flat which has been granted for a term of more than 21 years, or
• Someone who has a freehold interest or estate in the converted block of flats.

Apart from the exemptions and exclusions listed below, the proposed scheme will include all rented houses and flats with three or four persons in two or more households where there is sharing of bathroom and/or WC and/or cooking facilities.

For section 257 HMOs the additional licensing scheme will cover the external parts of a building including land associated with it such as gardens or yards, and communal areas such as hallways and landings. In these cases, it would be for the freehold owner to obtain the licence.

For a flat in a section 257 converted building that is occupied by three or four persons forming more than one household who share a basic amenity all of which are within the flat, that is sharing bathroom and/or toilet and/or cooking facilities, it would be for the owner of that individual flat to obtain the licence (whether the freeholder or a leaseholder). In some scenarios this will therefore require two (or more) licences to be in place in regard to the same building – one for the communal areas which are under the freeholder’s control (as well as any applicable flats under their control) and one for each flat with three or four occupants which is under a leaseholder’s control.

Those properties that have five or more occupants in two or more households and who share facilities are already covered by the mandatory HMO licensing requirements and should already have obtained a licence.

Properties that are already mandatorily licensed would not be required to obtain an additional licence under the proposed additional HMO licensing scheme.

Additional licensing schemes operate for a period of up to five years before they need to be renewed. A new consultation would then be undertaken at that time.

Examples of the types of properties that will be included in Arun’s additional HMO licensing scheme are shown below:

Colour key

Yellow = Under freehold ownership control, including exterior of building and any associated land

Red = Under leasehold ownership control three or four occupants in two or more households sharing bathroom, WC or cooking facilities

White = Under leasehold ownership control rented to a single occupant or a couple, two unrelated occupants, or a family or owner-occupied

 

Example 1

Freeholder owns the building

Entire house or flat has five or more occupants in two or more households sharing bathroom, WC or cooking facilities

Already licensable under the mandatory HMO licensing regime

 

Example 2

Freeholder owns the building

Entire house or flat with three or four occupants in two or more households sharing bathroom, WC or cooking facilities

Licensable under the proposed scheme. It would be for the freeholder to obtain the licence

 

Example 3

All three flats in the building are owner-occupied

Not licensable under the proposed scheme

Fire safety regulations and guidance would still apply to lobbies, hallways and landings

 

Example 4

Two flats are owner-occupied but the third is rented out to a family or fewer than three occupants

Not licensable under the proposed scheme

Fire safety regulations and guidance would still apply to lobbies, hallways and landings

 

Example 5

One flat is owner-occupied or rented to a family or fewer than three occupants by the freeholder

Two flats are rented out by leaseholders to a family or fewer than three occupants in each flat

Licensable under the proposed scheme

Only the common parts of the building and the exterior of the building and associated land would be covered by the license. It would be for the freeholder to obtain the licence

 

Example 6

One flat is leasehold owned and occupied

One flat is leasehold-owned but rented out to a family or fewer than three occupants

One flat is leasehold-owned and rented out to three or four occupants in two or more households sharing bathroom, WC or cooking facilities (red unit)

Under the proposed scheme the building is licensable including common parts and the exterior of the building, and associated land. This would be for the freeholder to obtain the licence

The flat rented out to three or four occupants is individually licensable under the proposed scheme. This would be for the flat’s owner to obtain the licence

 

Example 7

One flat is leasehold-owned and occupied or rented out to a family or fewer than three occupants

Two flats are leasehold-owned and rented out to three or four occupants in two or more households sharing bathroom, WC or cooking facilities (red units)

Under the proposed scheme the building is licensable including common parts and the exterior of the building, and associated land. This would be for the freeholder to obtain the licence

The two flats rented out to three or four occupants are both individually licensable under the proposed scheme. This would be for the flats’ owners to obtain the licences

 

Example 8

The freeholder owns the building and one flat which they rent out to three or four occupants in two or more households sharing bathroom, WC or cooking facilities

Two flats are rented out by leaseholders to a family or fewer than three occupants in each flat

Licensable under the proposed scheme

The common parts of the building, the exterior of the building and associated land and the flat with three or four occupants would need to be licensed. It would be for the freeholder to obtain the two licences

 

Example 9

Ground floor is a commercial premise

The two flats above the commercial premises are rented out to a family or fewer than three occupants in each flat

The common parts entrance and stairs and exterior of the building, and associated land are licensable under the proposed scheme. This would be for the freeholder to obtain the licence

 

Example 10

Two flats with communal hallway and landing on ground and first floor level

One flat is leasehold owned and rented out to a family or fewer than three occupants

One flat is leasehold-owned and rented out to three or four occupants in two or more households sharing bathroom, WC or cooking facilities (red unit)

Under the proposed scheme the building is licensable including common parts and the exterior of the building, and associated land. This would be for the freeholder to obtain the licence

The flat rented out to three or four occupants is individually licensable under the proposed scheme. This would be for the flat’s owner to obtain the licence.

 

Example 11

Two flats accessed by a communal lobby on the ground floor only. Each flat has a family or fewer than three occupants

Not licensable under the proposed scheme

Fire safety regulations and guidance would still apply to the lobby or entrance hallway

 

Example 12

Three flats all with their own separate entrances and no communal parts

Each flat has a family or fewer than three occupants

Not licensable under the proposed scheme

 

Example 13

Converted property where some flats do not have their own bathroom, WC or cooking facilities within the flat

Freeholder owns and rents out each flat

The common parts and exterior of the building, shared bathrooms and kitchens, and flats 2 and 3 are licensable under the proposed scheme. This would be for the freeholder to obtain the licence

 

Exemptions and exclusions

There are a number of properties and occupancy types that are exempt from requiring a HMO licence, either mandatory or additional. These exemptions to the licensing requirements are included in Schedule 14 of the Housing Act 2004 and primarily relate to buildings owned and managed by public sector bodies, housing associations, the police, and educational establishments. For the proposed scheme these will include the following:

• Any property occupied by only two people who form two households
• Buildings managed by a local housing authority, registered social landlord, police or fire and rescue authority or a health service body
• Buildings already regulated under certain other statutory provisions, such as care homes
• Student halls of residence and buildings managed by an educational establishment
• Buildings occupied for the purposes of a religious community whose principal occupation is prayer, contemplation, education or the relief of suffering. (This does not apply in the case of a converted block of flats to which section 257 applies)
• Common parts of purpose-built blocks of flats that meet the relevant Building Regulations at the time they were built (but individual HMO flats within the block may be licensable)
• The owner lives in the property with no more than two lodgers
• Owner-occupied properties. (This does not apply in the case of a converted block of flats to which section 257 applies, except for the purpose of determining the status of any flat in the block)
• Rooms or dwellings that are let as short-term accommodation on a commercial basis - for example a 'host family' arrangement for foreign students, a holiday let, or Airbnb (but if one room is let as the main residence of a tenant, the property may need a licence). It will be for the council to determine on evidence provided whether a let is a short-term let rather than a tenancy or other type of accommodation
• Properties let as part of an adult placement or Shared Lives scheme where up to three adult placements, plus their careers, live at the property
• Properties which are subject to a temporary exemption under section 62 of the Housing Act 2004
• Properties which are already subject to mandatory HMO licensing under section 55(2)(a) of the Housing Act 2004

It should be remembered that properties with three or more people and two or more households are still HMOs even if they are not licensable under the mandatory licensing scheme and are already legally required to meet national and/or local HMO standards.

Shared houses and flats with 3 or 4 occupants

The most appropriate person to apply for a licence will be the “person having control” of the property. This is normally the person who receives the rent. This may be a freeholder (for example, in respect of a building) or lessor who receives rent (in respect of an individual flat), whether directly or via an agent, from tenants or occupants of the property. In determining whether the proposed licence holder is the most appropriate party we will consider whether they have:

• the authority to ensure compliance with the licence conditions
• the authority to let and terminate the tenancies and receive the rental income
• are able to access all parts of the premises

Buildings converted into self-contained flats

In basic terms, the “person having control” and most appropriate person to be the licence holder in regard to a section 257 HMO building will usually be the freehold owner in regard to common parts. For a flat in a section 257 converted building that is occupied by 3 or 4 persons forming more than one household who share a basic amenity, it would be for the owner of that individual flat to obtain the licence (whether the freeholder or a leaseholder). In some scenarios this will therefore require 2 (or more) licences to be in place in regard to the same building – one for the communal areas which are under the freeholder’s control (as well as any applicable flats under their control) and one for each flat with 3 or 4 occupants which is under a leaseholder’s control.

There are fees to be paid to obtain an HMO licence. This is based on the officer and administrative costs that it takes to fully process and issue the licence application.

Licences would in general be for a five-year period, the maximum permitted by law, as with the mandatory HMO licensing regime. However, in some particular circumstances a licence might be issued for a shorter period, including in regard to the penalty schedule.

The licensing process can be time-consuming and complicated. It is therefore important that the landlords or licensees of those properties that will fall within the additional licensing scheme are proactive in applying for their licences. Time spent by officers in identifying and investigating non-compliant properties will have a significant knock-on effect to the overall success and efficiency of the scheme and other HMO-related work.

To encourage landlords/licensees to submit applications for licences in good time and before officers discover them through investigative work or complaints received, a penalty regime is in place.

 

Penalty schedule and length of licence

Penalty schedule	Length of licence
Application submitted within three months of commencement of an additional HMO licensing scheme.	Licence issued for 5-year duration
Application submitted after three months of the commencement date of the additional HMO licensing scheme but prior to investigation and/or contact by the private sector housing team.	Licence issued for 3-year duration
Application submitted after three months of the commencement date of the additional HMO licensing scheme but after investigation and/or contact by the private sector housing team.	Licence issued for 2-year duration
Application where a property is found to have been operating without a licence under the mandatory HMO licensing scheme for more than 3 months, following receipt of a complaint or as a result of other investigations.	Licence issued for 1-year duration
The responsible person may also be subject to enforcement action, for example, prosecution or issuing of a penalty notice.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Housing Act 2004 introduced Rent Repayment Orders (RRO). This was to cover situations where the landlord of a property had failed to obtain a licence for a property that was required to be licensed. An unlicensed property subject to a RRO imposed by the local authority, can require the landlord to repay up to 12 months’ worth of rent. If rent was paid through Housing Benefit or through the housing element of Universal Credit, then the rent must be repaid to the local housing authority. If the tenant paid their rent themselves, then the rent must be repaid to the tenant.

Failure to comply risks being issued with a banning order that prevents the property from being let. Serious and repeat offences may result in prosecution, a sentence of up to five years, and an uncapped fine.

The landlord may also be listed on the government’s Rogue Landlord database. An unlicensed property also means that the property manager cannot serve the occupier with a section 21 eviction notice.

Penalty fees, and any other additional fees, proposed for the additional HMO licensing scheme will also be applied to the already existing mandatory HMO licensing arrangements to ensure consistency across the entire licensing regime within the district.

Mandatory HMO licensing already covers properties that have five or more occupants in two or more households and who share facilities. Landlords of these properties should already have obtained a licence. Properties that are already mandatorily licensed would not be required to obtain an additional licence under the proposed scheme.

Read our standards for HMOs.

Read our HMO Licence Conditions.